Bangchak Petroleum Plc, the majority state-owned oil refinery, will gradually phase out mainstream petrol products in its service stations by the end of this year to strengthen its position as a market leader in alternative fuels.
Bangchak over the past five years has been ahead of its peers in marketing fuels including gasohol 91 and 95, each of which contains 10% ethanol, along with gasohol E20, a mixture of 20% etha nol and 80% premium petrol, as well as B5 (5% biofuel) and B100 (100% biofuel) diesel.
President Anusorn Sangnimnuan said that only a few Bangchak pumps still had regular or premium fuel available for cars made before 1995 that could not use any green fuels.
Bangchak stopped selling premium gasoline last year and replaced it with gasohol 95. Sales of its regular gasoline, meanwhile, have declined to 20% of total fuel sales from 40% in January. The com pany's overall oil product sales volume last month was 200 million litres, up from 170 million six months earlier.
Demand has been rising especially fast for E20 but the company has just 33 stations. It expects to have 60 by year-end when it forecasts demand of 500,000 litres per month. It also plans to replace all high-speed diesel with B5 by the end of this year, two years ahead of the government's 2011 deadline.
As well, it is developing facilities for gasohol E85, a blend of 85% ethanol blended in 15% petrol, at 15 stations in Greater Bangkok once flexible-fuel vehicles (FFV) become available.
However, Dr Anusorn said the marketing margin for E85 should be around 2.50 baht per litre to give companies an incentive to sell the fuel, since E85 facilities cost two million baht per station.
The company has set up a new subsidiary, Bangchak Biofuel Co, a one-billion-baht biodiesel producer, to start operations in mid-2009, with 300,000 litres of daily output.
It also intends to double to 20 the number of its compressed natural gas (CNG) or NGV filling stations to meet high demand from motorists.
Bangchak yesterday signed an agreement for a syndicated loan worth 29 billion baht with six banks to help refinance its debts. The loan will help cut interest payments for existing debts of 26.5 billion baht, said Dr Anusorn, with the rest of the proceeds to be used to expand Bangchak's refining business over three to four years.
The six lenders are Siam Commercial Bank, Bank of Ayudhya, Siam City Bank, TMB Bank, ABN Amro Bank NV and Mizuho Corporate Bank Ltd.
One billion baht will be set aside to upgrade oil refining efficiency to meet the Euro 4 oil standard, which will be effective in 2011.
Bangchak shares (BCP) closed yesterday on the SET at 11.50 baht, down 20 satang, in trade worth 2.07 million baht.
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